Keystone Report News Today

Homebuilder advocates have repeatedly said that the Twin Cities needs more housing, but so far this year only one of the two major residential construction sectors is doing its part to meet the rising demand for shelter.

The legislation, among other things, would allow for multifamily housing by-right in commercially zoned districts.

High interest rates crushed demand and forced builders to pivot to apartments.

Declines in for-sale new housing have been offset by an increase in demand for new rental housing as higher borrowing costs are forcing some would-be buyers to rent instead.

Permits for single-family homes fell 28% while those for apartment units were up 2%.

Rental construction soared while single-family construction fell, according to a monthly building permit report.

As low mortgage rates, high housing demand and low inventory continue to be the themes of the real estate industry in 2022, Twin Cities builders pulled permits for the fewest number of new housing units since 2016 during the month of February.

Rising development costs and other barriers to new construction weren’t enough to keep the Twin Cities from reaching a 16-year high in new homes permitted during the past year – but builders say the robust production isn’t enough to satisfy demand.

Rental apartments accounted for more than half of all housing construction during 2021.

Despite the decline in single-family construction during November, apartment construction increased slightly, putting housing construction on track to beat 2020.